Is Monero Traceable or Is It 100% Secure/Safe?
While Monero can be Secure and safe, it can also be traceable if you do not take the correct precautions that we outline below. So long as you do the following things your monero transactions should be 100% untraceable.
We’ll also briefly touch on best practices relative to the security-level you require, meaning if you are a simple man simply wanting to store their wealth there’s less of a need to obfuscate things compared to if you’re using monero as a means of payment for something less than legal.
Is Monero Secure & Safe?
Monero has an incredibly secure blockchain, much like bitcoin, and a “hack” of the network is essentially impossible. Not only are the developers top-notch paranoid lads with white-hat hackers helping them ensure the security of the network by Monero also runs off a PoW model that would require hundreds of millions — no billions to even attempt at taking over — and ultimately even if this occurred it wouldn’t functionally put anyone at risk.
As for it’s safety — so long as you don’t have a keylogger or virus of some sort on your computer there’s no way someone will steal your funds from your private wallet. It’s mathematically more likely that every molecule in your body separates and you appear on the other side of the room fully intact moments later than someone to guess your private key, so don’t worry about that. If you are worried, split up your funds between a couple addresses in case the impossible happens — or set up a multi-sig monero wallet if you’re a high roller that’s paranoid.
Didn’t mean it’s safety and security but rather YOUR safety and security using it? Well it won’t come out and punch you in face, but there’s potentially legal or other risks if you do not follow precautions we outline in the below section. If you follow them you should be 100% safe, secure, and anonymous when using monero.
Is Monero Traceable?
Yes, governments and nefarious actors can trace monero transactions and addresses to some extent ultimately even exposing the real identity of the owner of the monero — however due to certain privacy features Monero has that are unique to it if you follow certain steps you can eliminate this risk in multiple ways, depending on the security-level you require or desire.
The basics of ensuring your monero transactions are untraceable is that you must “launder” your monero, much like you’d launder money in real life. You have to make up bogus transactions on the monero blockchain by sending your monero between multiple wallets over and over. We cover this in detail in our article on monero mixers — but ultimately it boils down to Upon buying Monero with fiat or receiving it from a 3rd party of any sort you will want to “launder” it through multiple monero addresses before getting to the wallet you allow yourself to withdraw into fiat or transact with 3rd parties from.
Fiat On-ramp or 3rd party -> Wallet 1 -> Wallet 2 -> Wallet 3 -> Payment Address or Fiat Off-ramp
If you are a normal average joe mr legal steegle then the above is perfectly adequate for protecting your privacy, as there would be a <4% chance of possibly knowing if you still own the monero or where it went, and ultimately this makes you incapable of being prosecuted for owning monero if it became illegal to simply own it and takes you off the list of potential targets of robbery as there’s a good chance you spent it and don’t have it anymore anyway.
However, if you’re a mr hush hush we don’t talk about that sort of individual, well, you should probably escalate this to something like Fiat Onramp or 3rd party -> Wallet 1 -> Wallet 2 -> Wallet 3 -> Wallet 4 -> Wallet 2 -> Wallet 5 -> Wallet 4 -> Wallet 2 -> Wallet 6 -> Fiat offramp or 3rd party.
This is because <4% chance isn’t statistcally 0% chance and you don’t want ANY chance of it being linked to you if you’re not using monero for completely above-board transactions. The above Wallet pathway, combined with waiting a random small amount of time between transfers, will make your transaction so unplausaibly related to you that it’d be just as likely to be related to anyone else, making even the most advanced state-actors incapable of even getting a wiff of whatever is going on be it perfectly above-board transactions by a paranoid individual or black-market “criminal” transactions/behavior.
It’s a hassle and costs a bit of money to do this “laundering” of your monero, which is why I don’t think it’s a good idea for mr legal steegle average Joe, however if you are in a group that needs the ability to remain completely anonymous and untraceable then I’d consider it a must — just a cost of doing business.
Is There Anything Else to Know to Ensure You Can't Be Traced?
Just don’t break the protocol/pathway you outline above. You do not want “wallet 1” being where “wallet 6” is EVER or you’ll out yourself, and mixing up the order will increase the security risk of all previous transactions you made. Replacing wallets with no ones is fine, but do not mix their order.
Beyond that the only other advice for the ultra-paranoid would be to download a free software called Tails and make all transactions exclusively on it to ensure no computer, device, or internet connection that could be compromised/monitored handles any of the wallets.
Is Buying Monero on Local-Monero Safe?
Some people have asked if buying or selling your Monero via Local-Monero is Safer than a regulated KYC centralized exchange like Kraken — it’s not. You still have the same counter-party risk of the 3rd party being compromised or monitored by outside entities. It’s likely safer, but because you can’t guarantee that they aren’t compromised or monitored their self you shouldn’t rely on them not being compromised or monitored. You can’t guarantee anonymity with any fiat on-ramp or off-ramp.
This is why we recommend taking the above precautions, as it doesn’t matter if you’re transacting with the Literal FBI on both ends — so long as you properly laundered your monero they couldn’t prove or even correlate anything to you. Just make sure you pay your extortion (tax) fees — if you have no proof of funds make a nonsense online business that sells digital e-books or courses that you claim the monero payments were from, or claim it as mining profits and pay appropriate extortion (tax) fees to go full-cycle.